Iran to begin ‘crypto rial’ CBDC trial despite possible lack of infrastructure: Report

The Central Bank of Iran will hold a pilot launch of a central bank digital currency (CBDC) on September 22, the Iranian Chamber of Commerce has announced. The so-called “crypto-real” has been in the planning phase for several years.

The launch of the cryptocurrency was originally planned for November, according to the House, which said the CBDC aimed to “help improve financial inclusion and function as a powerful tool for the CBI to compete with other stablecoins globally.” . He added that experts in the country had concerns about companies’ readiness to use a CBDC, the public’s understanding of digital wallets and the effect the introduction would have on banks.

Crypto has also been seen as a means to counter widespread corruption in Iran. Development of the cryptocurrency began in 2018 and the Central Bank has committed to testing the CBDC throughout the year.

Al Jazeera reports that the CBDC will operate on the Borna platform, developed with Hyperledger Fabric, an open source distributed ledger technology platform from IBM. The news agency adds that banks will replace paper rials with electronic ones. As the platform is authorized, the Central Bank will select the banks to participate.

Borna was adopted in 2019 to help modernize Iran’s outdated banking system. According to an Al Jazeera source, the Borna platform will enable the provision of paid financial services, although this will not be part of the current trial.

Related: Iranian government to cut power supply to country’s legal cryptocurrency mining rigs

The use of cryptocurrency for payments in Iran is banned, but in August Iranians began using cryptocurrency to pay for imports, prompting concerns among Iranian companies about the lack of cryptocurrency regulation. The Blockchain Association of Iran has made similar calls in the past.